The Canada-U.S. Free Trade Agreement and labour market adjustment in Canada
AbstractEvidence suggests that the Canada-U.S. Free Trade Agreement (CUSTA) had almost no effect on earnings and had a small negative effect on manufacturing employment. Theory suggests that a change in trade policy may affect skilled and less-skilled workers differently. The labour market consequences of CUSTA tariff reductions are analysed in this paper. It is found that the tariff reductions lowered employment predominantly among less-skilled workers but did not affect the earnings of either skilled or less-skilled workers. The employment effects are due to the fact that relatively less-skill-intensive industries were more highly protected than high-skill-intensive industries prior to CUSTA.
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Bibliographic InfoArticle provided by Canadian Economics Association in its journal Canadian Journal of Economics.
Volume (Year): 33 (2000)
Issue (Month): 2 (May)
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- Eugene Beaulieu, 1998. "The Canada-U.S. Free Trade Agreement and Labour Market Adjustment in Canada," Working Papers 1998-11, Department of Economics, University of Calgary, revised 02 Oct 1998.
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